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Coillte has announced the sale of the share it owns in wind farms for €136.1m to Greencoat Renewables, the Irish subsidiary of UK-based renewable energy investment fund Greencoat Capital.
The sale comprises Coillte’s 50% stake in each of its joint-venture wind farms at Raheenleagh, Co Wicklow; Cloosh Valley, Co Galway; and Castlepook, Co Cork; and a 25% stake in Sliabh Bawn, Co Roscommon.
Coillte had developed the various wind farms through joint ventures with ESB, SSE and Bord na Móna. The transaction exceeds the five-fold return on the €25m invested in the projects expected by Coillte. This reflects the value attached by investors to access to land and progress achieved in developing the wind farms and connecting them to the national grid.
Land ownership retained
"While Coillte is selling its stakes in the wind farms, it is retaining ownership of the land on which they are sited and this will be a source of significant ongoing income for the company," Coillte said in a statement.
"The proceeds from the sale will be reinvested in the business to generate more value and to enhance the overall value of the Group. Over the coming months, we will announce details of how we plan to develop in excess of 1,000 MW of renewable energy-generating capacity over the next 10 years, across a pipeline of 25 projects we have identified on the Coillte estate," said chief executive Fergal Leamy.
Annual results
Coillte also published its annual accounts for 2017 this week, showing operating profit grow when large land transactions are excluded, with EBITDA rising by 6% from €80.3m in 2016 to €85.2m in 2017. Overall revenue rose 3% to €298.7m and Coillte paid an €8m dividend to its shareholder, the State.
When large land transactions are included, however, EBITDA dropped from €98.3m in 2016 to €85.2m last year.
"The company has now reduced its reliance on large-scale land transactions," Leamy said, setting a target of a 5% cash yield from Coillte's €1.4bn asset base by 2020.
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